Chart of the Day - Tuesday, December 26, 2023

Today’s Chart of the Day was shared by Alfonso Depablos (@AlfCharts). Small-Caps have surged since the end of October, with the Russell 2000 up +24% in the past two months. The index still needs to gain +19% before reaching all-time highs. However, Alfonso points out that some Small-Cap sectors have already broken out to record highs ahead of their Large-Cap peers. The Small-Cap Industrials Sector ($PSCI) broke out to record highs earlier this month, and the Small-Cap Materials Sector ($PSCM) broke out today. Meanwhile, The Large-Cap Materials Sector ($XLB) is still -5% below its record highs. The top holdings in $PSCM include $ATI, $SEE, $BCPC, $FUL, and $AMR. This ETF isn't a good trading vehicle because it's thinly traded, but it shows that there are opportunities among Small-Caps beneath the surface of the Russell 2000.